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J.P. Morgan Taps Renewable-Energy Markets

J.P. Morgan Chase & Co. is the latest big bank to seek to tap renewable-energy markets by striking deals that offset its own power needs.

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The largest U.S. bank by assets said that it plans to be fully reliant on renewable energy by 2020 globally, and will make $200 billion in clean-energy financing commitments by 2025.

Rivals such as Citigroup Inc., Morgan Stanley and Goldman Sachs Group Inc. have already put down markers through agreements to purchase power from renewable-energy suppliers.

Like the other banks, J.P. Morgan plans deals that will both offset its own consumption--its 5,500 properties in more than 60 countries cover 75 million square feet--and provide excess power that can be sold to customers or in markets. In November it signed a deal with a wind farm in Texas that will eventually provide electricity equal to about 75% of J.P. Morgan's consumption in that state.

The 20-year deal, struck with a subsidiary of NRG Energy Inc., will give J.P. Morgan access to the plant that produces 100 megawatts of electricity. The project is expected to come online this year.

J.P. Morgan said it expects in coming years to invest $600 million to $700 million in such initiatives.

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Additionally, the bank is making changes in branches and some corporate buildings, such as installing LED lights in a partnership with General Electric Co. and separately adding solar panels to some locations.

Daniel Pinto, head of J.P. Morgan's corporate and investment bank, said in an interview that the company won't use all the power generated by the providers it makes deals with. Excess capacity will be managed by the bank's commodities group to market to other companies.

"There is potential for a business there," he said, adding that the Texas wind-farm deal will be a guidepost.

J.P. Morgan said it will also boost the number of clean-energy financing commitments it makes, to an average of about $20 billion a year from around $16 billion--ranging from strategic transactions and capital raises to risk management and debt underwriting, executives said.